The Challenge of Trump: Noise and Reality

The Trumpian challenge: separating noise from substance

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Getting Ready for NAFTA Negotiations

For Canada, all hands on deck during NAFTA renegotiations

The rules of the road for trade with our biggest trading partner are about to be renegotiated. We need an all-of-Canada effort to get ready.

The stakes are critical: Three-quarters of our exports head south to the United States. Trade with the United States represents almost a third of our GDP and it sustains close to one in five Canadian jobs.

In the coming days, U.S. Commerce Secretary Wilbur Ross will formally advise Congress of NAFTA renegotiations, setting in play a 90-day consideration by House and Senate committees. By the latter part of the year, Mr. Ross expects that we will be into “real” negotiations that he predicts will take at least a year.

Following his White House meetings with Prime Minister Justin Trudeau last month, President Donald Trump described the Canada-U.S. relationship as just needing some “tweaking.” But, as Mr. Ross told Bloomberg this week, “there is a lot of meat to be dealt with,” including addressing the digital economy and revising the rules of origin.

After meeting recently with her Mexican counterparts in Toronto , Foreign Minister Chrystia Freeland said that Canada’s preference is for trilateral negotiations. Mr. Trump prefers bilateral deals but Secretary Ross says he is “open-minded” about the form. Regardless, Canada and Mexico need to stay close to avoid the divide-and-conquer techniques that are integral to Mr. Trump’s “art of the deal.”

Getting Canada’s act together means real collaboration between the federal and provincial governments and close, continuing consultations with business, labour and civic society. We need consensus on two questions:

  • What do we want from the negotiations?
  • How do we get there?

The more creative we can be, the better. The expertise of sectoral advisory groups proved vital to the successful negotiation of the Canada-U.S. free-trade agreement (1988) and NAFTA (1993-4). They should be resurrected and made permanent. We need to co-opt the best brains in our research community to rapidly crunch data and provide timely analysis for our negotiators.

The Canadian strategy going into the talks must be bold. A new agreement should be broad and comprehensive, providing for the free flow of people, goods and services with enforceable standards for labour and the environment. Let’s take the best from the stillborn (at least for now) Trans-Pacific Partnership. Prime Minister Justin Trudeau spoke to our mutually beneficial energy relationship in putting forward a Canadian policy that is both pragmatic and progressive.

Most of the American “asks” are readily identifiable. As Mr. Ross told Congress during his confirmation hearings, the United States wants to reduce its trade deficits and to restore manufacturing through increasing the “Made in America” content for rules of origin.

The United States Trade Representative annual National Trade Estimates report lists United States’ complaints with Canada. These include extending the intellectual property protection for pharmaceuticals; ending supply management for dairy and poultry; and inspecting for counterfeits, especially for Chinese goods shipped to U.S. destinations through Canadian ports like Vancouver or Prince Rupert.

The easiest solution on rules of origin would be to move to a customs union, but the Americans are unlikely to buy in unless it is a strictly Canada-U..S agreement. Otherwise we need to redefine rules of origin as “Made in North America.” American manufacturers should be our allies, especially those in the automotive industry, where supply-chain integration dates from the 1965 Canada-U.S. Auto Pact.

We should agree to counterfeit inspection in return for extended pre-clearance of goods and easier business travel access. Reforming supply management is long overdue, but let’s get something in return, such as access to U.S. shipbuilding contracts.

Where they were once divided, today Canada’s premiers are of like mind on the value of trade, leading missions across our oceans. Now they need to focus on our biggest customer, especially through cultivating their governor counterparts in regional meetings and through visits to their states. Premier Rachel Notley sets the bar through consistent visits to the US capitol and other US cities.

Access to procurement is vital, especially at the state and provincial government level and, for the premiers, this should be job one. Working with governors, they did a procurement reciprocity deal around the Obama infrastructure investments in 2010. Now we need to make it permanent.

The Americans like us, indeed, more than we like them. The Trudeau government has created good working relationships within the Trump administration. But complacency is a mistake. Mr. Trump’s priority is “making America great again.” The business of America is business. Canada needs to be ready.

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Trump and Energy

Canada and Trump have common ground in energy

While there are obvious areas of disagreement with the Trump administration around climate change, we need to find areas where we can work together, writes Colin Robertson.

An oilsands operation in Alberta. President-elect Donald Trump has proposed energy and infrastructure policies that could benefit Canada’s energy producers. Photograph courtesy of the Cumulative Environmental Management Association

By COLIN ROBERTSON Wednesday, Nov. 16, 2016 The HILL TIMES

Energy will be a top issue in Canada-US relations in a Trump administration. We need to reach out now—to the Trump transition team, Congress and state governments—to find common ground, and identify the points of convergence.

On energy, Donald Trump promises in his ‘America First Energy Plan’ to rescind President Obama’s executive orders on climate, including the Climate Action Plan, and to encourage Trans Canada to renew the Keystone XL pipeline permit application.

Mr. Trump also promises to save the coal industry, lift moratoriums on energy development, revoke restrictions on new drilling technology, cancel the Paris Climate Agreement, and ensure any new regulation is “good for the American worker.”

While there are obvious areas of disagreement with the Trump administration around climate change, especially the promise to rescind the Paris Agreement, we need to find areas where we can work together.

Canada is currently the biggest foreign supplier of energy to the U.S. In 2015, we provided 10 per cent of the natural gas consumed in the U.S., 43 per cent of its crude oil imports, 30 per cent of the uranium used in its nuclear-fueled plants, and two per cent of U.S. electricity consumption. Canadian energy is safe, secure and reliable.

Canada’s energy industry is increasingly about innovation and the application of technology. Operational excellence and environmental performance are completely compatible, observed General Electric CEO Elyse Allan last week while accepting the Energy Council of Canada’s ‘Person of the Year’ Award. Allan, like most Canadian energy industry CEOs, believes that Canada can achieve energy superpower status through its leadership on innovation.

‘Clean’ coal may be a dream today, but with investment in research and development, it may become a reality, and we have an incentive to figure it out. Canada’s billions of tonnes of coal reserves represent potentially more energy than all of our oil, natural gas and oil sands resources.

The University of Alberta is home to the Canadian Centre for Clean Coal/Carbon and Mineral Processing Technologies, and collaborative research with a Trump Department of Energy would seem an obvious opportunity.

We should work with like-minded states as well. California is already a partner in a cap-and-trade system with B.C., Quebec, and Ontario, through the Western Climate Initiative.

Mr. Trump has promised, as one of his first legislative actions, a 10-year, trillion-dollar American Energy and Infrastructure Act that will leverage public-private partnerships and private investments. The American Society of Civil Engineers has identified U.S. $3.6 trillion worth of pressing projects in America, all of which promise considerable bang for our bucks in terms of jobs and improved competitiveness. The list of projects includes repairing bridges, airports, dams and levees, seaports and waterways, mass transit, and freight rail, as well as energy pipelines and the electrical grid, most of which we share with the U.S..

There are obvious opportunities in the Trump plan to complement Canadian government infrastructure programs, and so advance North American competitiveness.

Sustaining an integrated North American approach to clean energy, conservation, and climate mitigation will also serve our own economic objectives. Royal Bank of Canada CEO Dave McKay recently observed that Canadians are polarized about resource development, “when we should be focused on how cleanly we can produce it, how safely we can transport it, and how wisely we can consume it.”

Canadian leadership, federal, provincial and municipal, needs to recognize and inform Canadians, that when responsibly harvested, our energy resources, including oil and gas, are our national inheritance. Telling the Canadian story means using the tools of social media with facts and science-based evidence. Elements in the Canadian story-line would include:

· fossil fuels and big hydro projects will be part of our energy mix for decades to come;

· the role that the oil sands, pipelines and big hydro projects play in North American energy independence;

· the innovative work of Canadian Oil Sands Innovation Alliance in reducing the oil industry’s land and carbon footprint and water usage—technology that has application globally;

· responsible energy development accords, developed through compromise and consensus (but consensus is not unanimity), that work for indigenous people and environmentalists, and contribute to jobs and prosperity; and

· Canada’s approach to carbon pricing (tax, levy, or cap-and-trade) and how this fits into our international climate change obligations.

There is a tendency in some quarters to assume the worst about a Trump administration, and weep about what might have been. This is a mistake. There will be differences, and we should be identifying the potential conflicts and figuring out how to manage them.

Where we disagree, we don’t have to be disagreeable. We also need to remember that, Olympic hockey finals aside, on almost every issue with the U.S. we can identify American partners. In advancing Canadian positions, our success rate rises proportionately with the ability to make them congruent with American positions.

Canadian leadership should pro-actively take the initiative with the Trump transition team, and identity the opportunities for cooperation on energy and infrastructure. If we get this right, mutual confidence will make it easier on the trade file. When the new Congress meets on January 3, 2017, and when the Trump administration takes office on January 20, we need to be ready for action.

 

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Clinton or Trump: Canada’s Energy Objectives with the USA

04 November 2016 – Ottawa, ON – The Canadian Global Affairs Institute today released,”Clinton or Trump: Canada’s Energy Relations with the US” by Colin Robertson, CGAI Vice-President and Fellow.

Energy, the environment, and climate change will figure prominently in Canada-US relations after January 20, 2017. The environmental movement will continue to press for ‘environmental justice’ –which means different things to different groups – in alignment with allies, especially indigenous peoples. Regardless of whether it is a Clinton or Trump presidency, Canadian leadership – provincial, federal, and private sector – must pro-actively advance our interests with Congress, the Administration and its agencies, and with state governments.


The complete report, “Canada –US Climate, Energy, and Environment Relations after the Election” is available at:
www.cgai.ca/clinton_or_trump_canadas_energy_relations_with_the_us

Download the PDF

 

Trump’s victory sends Trudeau’s energy, climate strategy into disarray

Canada’s energy future remains deeply entwined with that of the United States, which is now virtually our only customer for exports of crude oil, natural gas and electricity, and which has under President Barack Obama played a leadership role on international climate change action.

As a result of Mr. Trump’s upset, the prospect for a continental energy policy will look very different from this past year, since the Liberals came to power. The Republican standard-bearer has dismissed concerns about climate change, pledged to slash regulations that impede the production and use of fossil fuels, and is unlikely to stand in the way of new pipelines that would bring oil-sands crude from Canada to the refinery hub in the U.S. Gulf Coast.Mr. Trump favoured the Keystone XL pipeline that Mr. Obama turned down, and has said he will invite Calgary-based TransCanada Corp. to refile its application. However, the real estate developer said he would want a better deal for the U.S. including wanting “a piece” of the pipeline project for the U.S., though he has never suggested how that stake would be achieved.

If, as he has promised, Mr. Trump rolls back his predecessor’s climate commitments, Canada will face tough competitiveness questions as Ottawa and the provinces pursue plans to increase carbon prices in the coming years.

“With Trump, [energy policy] is a black box because he has not offered detailed plans,” said Colin Robertson, vice-president of the Ottawa-based Canadian Global Affairs Institute.

For subscribers: Trump’s victory is a worst-case scenario for Canada’s economy

Campbell Clark: Trump win throws a monkey wrench into Canada-U.S. relations

Read more: How Trudeau will try to bend Trump’s ear in the coming weeks

Renewable energy advocates insist that, regardless of the outcome of the presidential election, the U.S. will continue to see a surge in clean-energy investment as U.S. states pursue their own standards and policies that drive adoption of increasingly competitive wind and solar power.

But Mr. Trump would likely hurt the renewable energy sector because he would kill off Mr. Obama’s clean-power plan, which would encourage states to adopt clean power over coal-fired electricity. He will likely end a key renewable-energy tax credit when it comes up for extension in 2019, noted Divya Reddy, an analyst with Washington-based political risk firm Eurasia Group.

While the businessman diverged from Republican orthodoxy in areas such as trade and foreign affairs, he has echoed the party’s long-standing support for unfettered oil and gas development.

His chief energy adviser is Kevin Cramer, a North Dakota congressman and climate-change skeptic whom Ms. Reddy describes as “perhaps the most outspoken advocate for the U.S. oil and gas industry in Congress.”

Mr. Trump has committed to roll back regulations that hamper the industry. While he has not been specific, that may well include Obama administration plans to cut methane emissions from oil and gas sector by up 45 per cent – a joint Canada-U.S. commitment was made when Mr. Trudeau visited Washington in March.

Climate negotiators are gathering this week in Morocco for the annual United Nations summit and will have to assess how Mr. Trump’s victory will affect the Paris agreement reached a year ago.

He has threatened to walk away from the deal, which Mr. Obama ratified last month by executive order.

There are several ways in which Mr. Trump could undermine the Paris accord, which aims to limit the rise in average global temperatures to less than 2 degrees above pre-industrial levels. He can simply ignore U.S. commitments to reduce emissions, and to provide billions of dollars in aid to developing countries.

The surprise victory by Mr. Trump could force the federal and provincial governments in Canada to reconsider climate policies that will disadvantage energy producers here and drive up costs for manufacturers, said Laura Dawson, director of Canada Institute at Washington’s Wilson Center a non-partisan think tank.

“It may force Canada to backtrack on some of its initiatives that would put Canada too far out ahead as an outlier,” she said. “The Trudeau government was trying to go where the puck was going under an Obama White House but that puck might stop altogether under Trump, or it might turn into a basketball.”

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Clinton or Trump: Canada’s Energy Relations with USA

New Policy Update: “Clinton or Trump: Canada’s Energy Relations with the US” by Colin Robertson

Presidential_Debate_Photo.jpg
For Immediate Release

04 November 2016 – Ottawa, ON – The Canadian Global Affairs Institute today released,”Clinton or Trump: Canada’s Energy Relations with the US” by Colin Robertson, CGAI Vice-President and Fellow.

Energy, the environment, and climate change will figure prominently in Canada-US relations after January 20, 2017. The environmental movement will continue to press for ‘environmental justice’ –which means different things to different groups – in alignment with allies, especially indigenous peoples. Regardless of whether it is a Clinton or Trump presidency, Canadian leadership – provincial, federal, and private sector – must pro-actively advance our interests with Congress, the Administration and its agencies, and with state governments.


The complete report, “Canada –US Climate, Energy, and Environment Relations after the Election” is available at:
www.cgai.ca/clinton_or_trump_canadas_energy_relations_with_the_us

Download the PDF


The Canadian Global Affairs Institute is always looking for submissions from scholars and practitioners.
Submit your work here.

For More Information Contact:
Meaghan Hobman
E: mhobman@cgai.ca

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Canada and Seapower

Why Canada needs to look to the seas

The Globe and Mail Tuesday, May. 13 2014

Lest we forget. On Parliament Hill last week we marked the end of our Afghanistan mission. We also remembered the Battle of the Atlantic.

In what Winston Churchill described as the “dominating factor” of the Second World War, the Royal Canadian Navy and our merchant marine kept open the sea lanes, carrying the vital flow of food, energy and arms to Britain.Today, Canadians look increasingly to the sea as passage for our own prosperity. Consider:

  • 70 per cent of the world is covered with water.
  • 80 per cent of the globe’s population lives near water.
  • 90 per cent of what feeds, clothes and fuels us travels by water; an ‘invisible industry’ of a hundred thousand container ships.

With three oceans at our back and the longest coastline in the world, Canada and its economy, observed Prime Minister Stephen Harper, “float on salt water.” On any given day, one third of the inventory of enterprises like Canadian Tire is at sea.

Increasingly, we export more of our resources and food by sea. Potash is shipped to more than 100 markets. Pulse, a multi-billion dollar Canadian industry, ships to 150 markets. Its production has increased fivefold in the last 20 years and it is our biggest export to India.

Once we have east-west pipelines and LNG terminals we can truly be an ‘energy superpower’ shipping our oil and gas across the Pacific and Atlantic. In Europe, our energy can be a strategic alternative to dependence on Russia and the Middle East.

Canadians have long plied North Atlantic and Pacific waters. Now the Arctic is opening. Last September, the Danish-owned Nordic Orion – laden with B.C. coal for Finland – became the first bulk carrier to navigate the North West Passage. That trimmed a thousand miles off the normal Panama Canal route.

Order on our oceans, straits and coastal waters is underwritten by international covenant. Negotiation of the United Nations Convention on Law of the Sea is one of the greatest triumphs of Canadian diplomacy. Canadian jurisdiction was extended to the continental shelf, effectively doubling our ocean estate.

With 40 per cent of our land mass in our northern territories, and 25 per cent of the global Arctic, securing international recognition for Canada’s claim to an extended continental shelf and seabed rights is a national priority.

Our ability to enforce the law and guarantee safe passage depends on naval power. Navies, with air support, can project power over huge distances.

For the last two centuries, first the Royal Navy and then the United States Navy have kept watch over our sea lanes. Now, facing new threats and with domestic financial constraint, President Barack Obama has called on NATO leaders to “step up and carry” their “share of the burden”.

Canada’s armed services need strengthening. Topping the list must be new ships for our Navy and Coast Guard. We need them early and in sufficient numbers to defend our sovereignty and carry our international obligations.

The recent redeployment of HMCS Regina, from anti-piracy and anti-terror work in the Arabian Sea, to join NATO’s mission of ‘reassurance’ for Ukraine underlines the requirement for readiness. But not replacing Regina in the Gulf reminds us we lack resiliency.

To get our new fleet to sea the government has set forth its National Procurement Shipbuilding Strategy and the proposed Defence Analytics Institute.

But with delays, cost-overruns and budget-paring, when will we see our polar icebreaker CCGS Diefenbaker? Or our joint support ships – HMCS Queenston and HMCS Châteauguay? And what of our Arctic offshore patrol ships and new warships? Defence procurement involves many actors with different agendas:

  • Public Works wants due process, however protracted
  • Treasury Board wants third-party, validated costing
  • Industry Canada wants jobs and regional benefits
  • Defence wants ships and budgets to operate them
  • Industry wants clarity

Without sustained political oversight, institutional resistance can sink even the best governance model. Can ship procurement be leverage in our trade negotiations? The Royal Navy are buying their new supply ships from Korea. Other allies including the Dutch and the Australians contract offshore for hulls and do the sophisticated work at home.

Expeditious delivery of our ships must drive our procurement process. Otherwise, we risk shrunken fleets, stretched to patrol our waters or contribute to continental and NATO security.

“Enterprises might succeed or miscarry, territories might be gained or quitted,” wrote Churchill, “but dominating all our power to carry on the war, or even keep ourselves alive, lay our mastery of the ocean routes and the free approach and entry to our ports.” Churchill’s dictum still applies.

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Canada, Energy and the Environment

We need a national ecological strategy to match our energy ambitions

The Globe and Mail Wednesday, Mar. 13 2013

“There are an awful lot of folks who are trying to make up their minds, and trying to draw the right balance,” observed U.S. ambassador David Jacobson on the divide between the energy and security benefits of oil-sands imports and the environment. On the environment, he was emphatic: “There needs to be more progress.”

Sadly, wrongly, the Keystone XL pipeline debate has become the U.S. environmental movement’s litmus test for the Obama administration’s position on climate change. In reality, the American emissions challenge is not so much Canadian production as American consumption.

The columnist Fareed Zakaria wrote this week that Keystone XL is “a symbol of how emotion has taken the place of analysis and ideology now trumps science on both sides of the environmental debate.”

But Canada is capable of demonstrating the “progress” requested by ambassador Jacobson – and if we do so, the benefits to Canada can be even greater.

Start with the measurable climate-change achievements that can be met through provincial initiatives.

British Columbia has a working carbon tax. Alberta has a carbon compliance market. Saskatchewan has piloted carbon capture and storage, including collaborative projects with Montana and North Dakota and the US Department of Energy.

Leadership in getting out of coal-fired generation began in Ontario. Quebec has a cap on carbon. There are other projects – tidal power in the Bay of Fundy, alternative energy initiatives in biomass, wind and solar.

In terms of land claims and constructive collaboration with First Nations, Manitoba and Quebec lead the way in their development of hydroelectricity, including transmission lines.

Knit these initiatives together and look to the lessons learned in the negotiation of the Boreal Forest Accord. Its architect Avrim Lazar says the forest industry concluded that “our jobs and growth in the future will rest on making our environmental practices the highest in the world.”

Make our experience the base for further regional ‘green’ initiatives, especially those that focus on water use. These will also give us critical components of a national energy strategy that will put us ahead of our climate-change obligations. Many companies in the energy sector are already using shadow carbon pricing.

Draw on efforts taking place at the provincial level and by the premiers, who are working both Washington and their governor counterparts.

In so doing, we can also go a long way towards developing a national energy strategy, one that should also include getting our oil and gas to tidewater. The discussions launched by premiers Redford, Alward and Marois deserve further debate at the Council of the Federation when they meet this summer.

Trans-border environmental cooperation is well-entrenched. In 2009 Canada and the United States celebrated a century of co-operation protecting shared waters. Regional collaboration is especially strong at the premier and governor level.

Premiers Wall, Redford and Selinger were all working Washington recently, the latter pair at the recent National Governors Association. Premier Wall made a useful observation that Americans need to be constantly reminded of their northern partner because “like a long-lasting marriage, it’s important to have a date night.”

Premier Selinger argued that we also need to push the Americans to show some “progress” of their own on hydroelectricity, the cleanest energy in terms of greenhouse-gas emissions. Ambassador Doer is right when he decries US obfuscation in defining Canadian hydro under renewable-energy standards.

We are in alignment with the US on our Copenhagen commitments. Our vehicle emission standards are in tandem.

We are ahead, although not pure, on national coal standards that will see the eventual phase-out of coal generation. Ontario will close its coal-burning plants by the end of this year. A decade ago, coal fired 25 per cent of its grid.

Our weak link is oil and gas regulations, now promised for mid-year.

Usually, we are the ones making ‘asks’ of the United States on environmental issues such as Acid Rain, the Devil’s Lake water diversion, Great Lakes clean-up, and preserving the sanctity of the Arctic. Brian Mulroney artfully demonstrated that on Acid Rain, when we clean up our own act, we can ‘shame’ the United States into action.

The perception that we are on the wrong side of the environmental fence doesn’t jibe with where Canadians tell pollsters they want their government to be.

At his namesake convention this past weekend, Preston Manning encouraged Canadian Conservatives to make the environment a ‘sword’ rather than ‘shield’ and become “more positive and proactive.”

We can meet or exceed Ambassador Jacobson’s expectations with a national ecological strategy that matches our energy strategy. To paraphrase Prime Minister Harper, we have within our capacity the ability not just to be an energy superpower, but to be an ‘eco-energy’ superpower

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Energy relationship and Canada-US Security

CTV Powerplay with Don Martin May 6 with Scotty Greenwood and Colin Robertson Scotty Greenwood, a senior advisor at the Canadian-American Business Council and Colin Robertson, a former Canadian envoy to the U.S. discuss the implications the oil spill in Alberta will have on proposed pipeline projects in the states.

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Will a Republican House be Good for Canada-U.S. Trade Relations?

November 9: Will a new Republican dominated congress be good for Canada, or will the emergence of the Tea Party push the U.S. to a more protectionist stance? BNN finds out from Allan Gotlieb, former Ambassador to the U.S. and Colin Robertson, vice-president, Canadian Defence and Foreign Affairs Institute.


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